El Salvador has moved its Bitcoin reserves into several new wallet addresses as a safeguard against potential quantum computing risks.
“Dividing funds into smaller amounts reduces the potential impact of a quantum attack,” the country’s Bitcoin Office stated in a Friday post on X, noting that each wallet contains up to 500 BTC.
The office further explained that once Bitcoin is spent from an address, its public keys become exposed and potentially vulnerable, making them a target for future quantum computing advances.
Over 6 million Bitcoin—valued at roughly $650 billion—could be at risk if quantum computers advance enough to break elliptic curve cryptography (ECC) keys, according to quantum research firm Project Eleven in April.
El Salvador has taken action: the country previously stored its 6,274 BTC reserve (worth $678 million) in a single address, but blockchain records show the funds were moved into 14 new wallets on Friday.
Quantum threat still distant
Although El Salvador’s precaution drew praise from industry experts, Project Eleven emphasized that quantum computers are still far from being able to compromise Bitcoin. A Bitcoin private key is 256 bits long, and no quantum machine using Shor’s algorithm has even broken a 3-bit key so far.
In June, Michael Saylor, the strategist behind MicroStrategy’s Bitcoin approach, dismissed fears of a quantum threat as largely hype, noting that if it ever became a real concern, Bitcoin’s core developers and hardware makers would introduce necessary safeguards.
“The answer is: Bitcoin network hardware upgrade, Bitcoin network software upgrade, just like [how] Microsoft, Google, the US government upgrade.”
El Salvador remains mired in IMF controversy
Questions have arisen over El Salvador’s Bitcoin acquisitions after an International Monetary Fund report in July suggested the country hasn’t bought any new Bitcoin since February.
The nation’s Bitcoin Office has not directly responded to the report but continues to share updates about its Bitcoin activity on X.
In December 2024, El Salvador secured a $1.4 billion funding agreement with the IMF, agreeing to scale back its Bitcoin initiatives among other conditions. However, the exact terms of the deal appear to be contested between the two sides.
